Katz v. Liberty Power Corp.

SAMUEL KATZ and LYNNE RHODES individually, and on behalf of all others similarly situated, Plaintiffs, v. LIBERTY POWER CORP., LLC AND LIBERTY POWER HOLDINGS, LLC, Defendants.

Civil Action No. 18-cv-10506-ADB

UNITED STATES DISTRICT COURT DISTRICT OF MASSACHUSETTS

June 26, 2020

OMNIBUS MEMORANDUM AND ORDER ON PARTIES' DISCOVERY MOTIONS

BURROUGHS, D.J.

Samuel Katz ("Katz") and Lynn Rhodes ("Rhodes," and together with Katz, "Plaintiffs"), on behalf of four putative classes, allege that Liberty Power Corp., LLC and Liberty Power Holdings, LLC (together, "Defendants" or "Liberty Power") or their agents placed calls in violation of the Telephone Consumer Protection Act ("TCPA"), 47 U.S.C. § 227 et seq. [ECF No. 34 at 1]. On September 24, 2019, the Court issued a memorandum and order denying Liberty Power's motion for summary judgment and granting in part Liberty Power's motion to dismiss. [ECF No. 195].

Presently before the Court are Plaintiffs' motions to compel compliance with requests for production ("RFPs"), [ECF No. 206], and to compel discovery of Defendants' financial records, [ECF No. 214], as well as Defendants' motion to quash a subpoena seeking information related to a number of email addresses associated with one of their employees and a dialing service used when making calls on behalf of the Defendants, [ECF No. 219]. As more fully explained below, the motions to compel compliance with requests for production, [ECF No. 206], and to release certain financial records, [ECF No. 214], are GRANTED in part and DENIED in part and the motion to quash the subpoenas, [ECF No. 219], is DENIED because Defendants lack standing to challenge the subpoenas.

I. LEGAL STANDARD

Pursuant to Federal Rule of Civil Procedure 26(b), parties are entitled to discovery "regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case." Fed. R. Civ. P. 26(b)(1). Rule 26 is "construed broadly to encompass any matter that bears on, or that reasonably could lead to other matters that could bear on, any issue that is or may be in the case." Energy Power (Shenzhen) Co. v. Wang, No. 13-cv-11348, 2014 WL 4687784, at *2 (D. Mass. Sept. 17, 2014) (quoting Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 351 (1978)). "District courts exercise broad discretion to manage discovery matters," Heidelberg Ams., Inc. v. Tokyo Kikai Seisakusho, Ltd., 333 F.3d 38, 41 (1st Cir. 2003), and "to tailor discovery narrowly," Cutter v. HealthMarkets, Inc., No. 10-cv-11488, 2011 WL 613703, at *2 (D. Mass. Feb. 10, 2011) (quoting Crawford-El v. Britton, 523 U.S. 574, 598 (1998)). When exercising this discretion, courts are mindful of the proportionality considerations articulated in Rule 26(b)(1). Fed. R. Civ. P. 26(b)(1).

"A court must limit discovery if it determines that the discovery sought is (1) unreasonably cumulative or duplicative, or is obtainable from some other source that is more convenient, less burdensome, or less expensive; (2) the party seeking discovery has had ample opportunity by discovery in the action to obtain the information sought; or (3) the burden or expense of the proposed discovery outweighs its likely benefit, taking into account the needs of the case, the amount in controversy, the parties' resources, the importance of the issues at stakein the litigation, and the importance of the projected discovery in resolving the issues." In re New England Compounding Pharmacy, Inc. Prods. Liab. Litig., No. 13-cv-02419, 2014 WL 12814933, at *2 (D. Mass. Feb. 7, 2014); see also Fed. R. Civ. P. 26(b)(2)(C).

As the party resisting discovery, Defendants bear "the burden of showing some sufficient reason why discovery should not be allowed." Flag Fables, Inc. v. Jean Ann's Country Flags and Crafts, Inc., 730 F. Supp. 1165, 1186 (D. Mass. 1989) (citation and internal quotation marks omitted).

Merely because compliance with a "Request for Production" would be costly or time-consuming is not ordinarily sufficient reason to grant a protective order where the requested material is relevant and necessary to the discovery of evidence. . . . [Where] the plaintiff has a demonstrable need for the documents, the defendant undisputedly has possession of them, and the plaintiff has no other access to them . . . . the defendant has a duty pursuant to Rule 34 to produce [responsive documents]..

Kozlowski v. Sears, Roebuck & Co., 73 F.R.D. 73, 76 (D. Mass. 1976) (internal citations omitted).

Further, any objection that the Defendants did not raise in their initial response is deemed waived. West v. Bell Helicopter Textron, Inc., No. 10-cv-00214, 2011 WL 6371791, at *7 (D.N.H. Dec. 20, 2011) (noting that "defendant had waived [objection] by omitting it from other objections raised in its initial response to the discovery requests . . . . .").

II. DISCUSSION

A. Plaintiffs' Motion to Compel Initial Class Discovery

Plaintiffs moved to compel Defendants to produce documents responsive to RFPs 1, 2, 3, 11, 14, and 38. [ECF No. 206]. Plaintiffs first served the requests on June 20, 2018, and Defendants responded and noted their objections on July 27, 2018. [ECF No. 215-2 at 1-2]. Plaintiffs seek call records for all of the calls made by telemarketers on behalf of the Defendants (RFP 1), lead lists that Defendants provided to telemarketers (RFP 2), all documents concerningcommunications with Defendants' telemarketers about the lead lists (RFP 3), communications with telemarketers about Plaintiffs' subpoenas (RFP 12), communication with telemarketers about this case (RFP 13), and communications with telemarketers about requests for call records (RFP 38); communications with Mezzi Marketing, LLC, ("Mezzi") a vendor used by Defendants to make calls on Defendants' behalf, about TCPA compliance (RFP 14); and documents concerning incidents where Defendants lost access to any document which would have been responsive to Plaintiffs' requests (RFP 11). See [ECF No. 210 at 4-10 (listing RFPs)].

As a preliminary matter, Defendants argue that the motion to compel should be denied because the parties failed to meet and confer before Plaintiffs filed this motion. [ECF No. 210 at 3]. A court may deny a motion to compel if the parties failed to meet and confer regarding the discovery dispute. Gouin v. Gouin, 230 F.R.D. 246, 247 (D. Mass. 2005).

The parties had a teleconference on November 7, 2019 to discuss discovery disputes identified by Plaintiffs in a letter to Defendants. [ECF No. 210 at 2; ECF No. 210-3 at 2]. Defendants allege that it quickly became obvious that Plaintiffs were using the call to address other case issues, rather than the discovery disputes raised in the letter. [ECF No. 210 at 2]. Plaintiffs ultimately agreed to organize a second call to discuss the discovery issues, but instead filed the instant motion. [Id.]. Therefore, for some of the requests, the Court orders that the parties meet and confer to determine the scope of requests and relevant production.

1. Request Nos. 13 and 14

On February 27, 2019, the Court granted Defendants' request to bifurcate discovery and stayed class discovery while the Court considered the motion for summary judgment on facts that were specific to the representative Plaintiffs. [ECF No. 125].

Defendants' only objections to RFPs 13 and 14 stem from their motion to bifurcate discovery. [ECF No. 210-4 at 14-16]. Because the Court has considered and denied the motion for summary judgment, [ECF No. 195], bifurcation is no longer a legitimate objection to producing the relevant documents. Therefore, considering RFP 13, Defendants are ordered to provide all documents concerning any communication regarding the instant case between Defendants and their Telesales Channels, if Defendants have not already produced such documents or if they are otherwise privileged.

Regarding RFP 14, Defendants represent that they "ha[ve] agreed to conduct a search regarding Mezzi Marketing, and there is no basis for this being subject to a Motion to Compel." [ECF No. 210 at 7]. To the extent that they have not already done so, Defendants are ordered to provide all documents relating to communications between Liberty Power and Mezzi Marketing, LLC since September 8, 2016, concerning Liberty Power disciplining or terminating Mezzi Marketing, LLC, or discussing training and compliance with the TCPA.

2. Request No. 1

RFP 1 seeks "all records and/or call detail records for calls made by Liberty Power's Telesales Channels to Liberty Power's potential and/or prospective residential customers during the class period." [ECF No. 210-4 at 5]. Although Defendants maintain that this request is "exceptionally broad," [ECF No. 210 at 4], they do not contest that the records are electronic, which suggests a less burdensome production. See [ECF No. 207 at 6].Further, Defendants havethemselves previously served subpoenas on third parties in this case seeking "all contracts, inbound and outbound phone call and fax logs, billing statements, features, and payment histories" for telephone lines that were allegedly illegally called. [ECF No. 125 at 6]. Though the Court understands that production may be burdensome, courts often order production of these kinds of documents, which Defendants themselves have previously requested. "Courts often permit discovery of records related to the telephone numbers at issue in TCPA cases." Katz v. Liberty Power Corp., LLC, No. 18-cv-10506, 2019 WL 957129, at *4 (D. Mass. Feb. 27, 2019). Given the availability of Defendants' call records, and the fact that such call records are relevant to Plaintiffs' claim that Defendants violated the TCPA, the Defendants are ordered to provide all records of calls made by Liberty Power's Telesales Channels to potential and prospective customers during the class period. Recognizing that this may in fact be overly broad and burdensome, however, the Court will consider limiting the production if Defendants make a more detailed showing of burdensomeness or...